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- Title
Economic Development and the Utility of Local Content Legislation in the Oil and Gas Industry: Conflicts and Effects of Nigeria's Local Content Act in the Context of International Investment Law.
- Authors
Okpe, Felix O.
- Abstract
Economic development is a major policy objective of the governments of developing countries that are rich in natural resources. Nigeria has promoted, through legislation, the concept of Nigerian content through domestic capacity building and preferential participation as a policy in its Oil and Gas Industry("OGI") to achieve the objective of economic development. The recent enactment of Nigeria's Local Content Act was inspired by considerations for economic development. This article analyzes the implications of this law based on the paradigm of international investment law. For this purpose, the context of international investment law is limited to the definition of "investment" and the international obligations of Nigeria within the framework of current and anticipated Bilateral Investment Treaties ("BITs") and other investment related agreements with foreign investors. From this perspective, the analysis of this article shows that, in spite of the relative success of the Local Content Law, there are significant and fundamental conflicts with Nigeria's obligations under international investment law with respect to foreign investors operating in Nigeria's OGI. Foreign investment treatment standards applicable under international investment law are implicated in the application and administration of Nigeria's Local Content Law. Thus, this article proposes that Nigeria should review existing BITs and other investment agreements to accommodate the prescriptions of the Local Content Law to sustain the underpinnings of economic development inherent in the law. Otherwise, the existing conflicts present substantial grounds for foreign investment claims and liability against Nigeria by foreign investors in the context of investment treaty arbitration.
- Subjects
NIGERIA; PETROLEUM law &; legislation; FOREIGN investment laws; ECONOMIC development; INVESTMENT treaties; INTERNATIONAL arbitration
- Publication
Pacific McGeorge Global Business & Development Law Journal, 2015, Vol 28, Issue 2, p255
- ISSN
1936-3931
- Publication type
Article